European Retail Banks Restructure Without Losing Service Quality
The European retail banking industry needs help because customer trust is low, and there is a chance that people will only pay back their loans. Some European banks have decided to reorganize to cut down on losses and get ready for a challenging consumer lending environment.
Most recently, it was reported that BNP Paribas was looking into several options for a significant restructuring of its consumer finance division.
The announcement comes as lending by European banks to individuals and businesses has decreased for the first time in nine years due to interest rate rises and a potential eurozone recession.
Suppose the French bank moves forward with the reorganization. In that case, it may decide to sell off a portion of the company to reduce expenses and emphasize divisions and regions that are more lucrative. BNP Paribas has previously committed to selling Postbank, the Eurobank subsidiary in Bulgaria, its finance business.
Future sales or service reductions might be in the works.
One of the top aims of the recently announced merger of Societe Generale and Crédit du Nord Group has been to keep branches operating and retain those crucial client touchpoints as part of another ongoing bank reorganization carried out by Societe Generale Group.
The newly established retail bank, known as SG, was officially launched on Jan. 1 in a significant consolidation of the group’s retail banking businesses after more than two years in the works.
Customers in France will have access to a more comprehensive branch network thanks to the merging of the two banks’ retail assets than they did before the companies’ separation, Societe Generale noted in a news statement.
“All customers will benefit from an increased number of points of sale, multiplied by more than two for customers from Crédit du Nord Group and increased by 15% for Societe Generale customers,” the release said.
The Banque Courtois is the oldest bank in France that is still open. It was founded in 1760 and is part of the Crédit du Nord Group, which has a long history in the retail banking industry of France. Before Societe Generale bought it from Paribas in 2000, the FI had been owned by Paribas for a long time.
Networking Branch Consolidation
Local and regional banks like these need to fit in with the current global banking system, which many international giants dominate. However, they are still a big part of French banking, and many customers and small businesses depend on them.
This goes back to when many smaller local banks joined together to form the Crédit du Nord Group through mergers and alliances. In a way, its recent merger with the SG brand is the latest chapter in a 100-year-long story of mergers.
Although there is a compelling commercial argument for pooling resources and simplifying too intricate systems, banks must do so without compromising the quality of their services.
It remains to be seen if the FI can keep up its service standards and meet its goal of increasing the number of branches clients can use as the new SG bank starts reorganizing the branch networks of its previously separate parts.
